GSM: Where Will The Next Competition Come From?
by Okoh Aihe2006-01-14 00:00:00 | Viewed 1689 times
It was like magic over a year ago when the NCC boss, Engr. Ernest Ndukwe, told the industry operators of the commission’s ambition to connect the next 10 million lines. With that number, the communications industry that had over 10 million lines in record time would have doubled its line haul. Was this ever possible?
To most of the people it may just have been plain ambition while to others it was normal reasoning in line with what the commission has been doing since auctioning of the GSM licenses.
In the first week of the year, it is quite interesting now to look back and say that performance may have surpassed all projections. Reason being that by September of last year, the number of lines were over 17 million comprising 16,078,817 mobile lines and 1,207,707 fixed lines. The figure is nearly unimaginable because only in the turn of the decade, say in 2000, the country had less than a million connected lines from both the incumbent operator, NITEL and the other fixed operators. It was such a scandal for a big country like Nigeria and that was before some magic began to happen in the sector.
The progress in the telecom sector has been hailed all over the world with the global body, ITU specially singling out Nigeria for some praises. But the growth is fired mainly by the GSM sector with most of the lines coming from MTN, Glo and Vmobile. Mtel tied to the apron of the troubled Nitel has been contributing lately as it can now boast of about 1.2 million lines. Thus taking the performance of the company beyond what the management contractors could achieve. From all indications the growth has come mainly from the mobile sector because even as the people are getting connected and are able to talk, talk is not still as cheap as it should be. Using the mobile phone in terms of cost is not fun and most of the offices in the country use mobile for their backbone operations.
In the New Year, the question remains, where will the major progress come from this time? Will mobile continue it bullish dominance and rubbish every other communications technology tool?
Perhaps.
And this is the reason for that answer. This year there will be major developments like the Unified Licensing Scheme that will level the industry for all operators. This means that even the fixed operators will go forcefully into mobile operations and give lines that may not be that expensive to run. With understandable features of mobile technology, its dominance over the other technology has been quite glaring and significant, and this obviously will peter out in the year.
But will it be as simple as that? Perhaps not. Some private operators are already agitating that since the GSM operators have dominated the industry in terms of visibility and earnings, the fixed operators should be allowed free entrance into the scheme, not to pay a dime. And supporting their line of argument, somebody asked how many of them are doing enough business to be able to pay anything. This is like scorn but it is the truth. Most of the fixed wireless operators are going down the grave and it will really not be possible to sketch how many of them will be standing when that scheme comes.
However, GSM will continue to play a dominant role. The operators are making enough money to take services anywhere only if they can improve the quality of service. Glo is putting enough money in network expansion to frighten any player. Only recently, Vmobile got a hefty loan of a billion dollars from a consortium of banks to announce a very pompous position from its previous feeble standing. And Vodacom has still been lurking in the corner after its initial shameful departure waiting to invest in an organization that has refused to turn cadaver. MTN is making a kill and that is what is mainly responsible for Vodacom’s desperation. What this means is that mobile may continue with its dominance of the sector. But that really may be the bad news.
Because pleasant and exciting as it is to hold a piece of fine mobile phone, the real progress will only be made when emphasis returns to the fibre sector, when subscribers will be able to work with land lines in offices and run their fax as modern business is supposed to be. Most people yearn for the day they can drop their phones, use land lines and use the mobile only when necessary.
At the moment, Nigeria accounts for some of the highest sales of VSAT in the world. What this means is obtuse development in the telecom sector. Only about two years, one operator sold over a thousand VSAT terminals in a year, and at the global meeting, experts were quick to conclude the backwardness in the sector.
Perhaps having noticed this problem, the NCC, apart from the Unified Licensing Scheme is also embarking on a lot of other projects like Wire Nigeria where is expected to take backbone rollout to some impossible places in the country.
Where will more development come from? Most people expect all the licensees to pay attention the utilization of their licensees. They will expect Globacom to formally activate its digital rollout, they will expect that something positive happens to Nitel, they will want cost of mobile phone usage to come down. They will expect a lot of other positive developments.
Mobile technology appropriating the limelight with GSM has long controlled the sector, people expect a change this year and will like the NCC to do something in the area of pricing.
Nigerians will expect that when next the regulator is giving a brief the percentage of mobile dominance over fixed lines would have reduced significantly so that they can stop using mobile and VSAT to run their businesses.
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